Dividend Income orientated Blog. Ideas and Thoughts about Stocks, Dividends and Growth Opportunities.

I Put Darden Restaurants Shares In The Dividend Yield Passive Income Portfolio

Last
Friday I put 30 shares of Darden Restaurants (DRI) in my virtual Dividend Yield
Passive Income (DYPI) Portfolio. The Portfolio was funded with 100k a few weeks before.
The portfolio is not real one but I want to show you how to make money with
dividend stocks. The approach is to show you how to realize a reliability income from solid
dividend paying stocks. I also like to show that it is possible to buy stocks
in every market situation. The only thing you need is time and patience. Big
yields could only realized over a long period of time.

For the
time being, the DYPI-Portfolio has only 10 stocks and I like to increase the
number of shares to 50-70 over the next years. I buy slowly stocks. This is a
strategy that fails if the market goes strongly up as happend in the recent few weeks. But my approach is not to
get quick rich and I hope you don't want it too. I want to show you how to build-up a reliable passive income from
stocks with only $100k of investment funds.

The ten
stocks from the DYPI-Portfolio generate roughly $500 annulized dividend income which represents around 4% portfolio yield. In addition, I have $86 k of free cash
for further stock buys. I like to raise the dividend cash output to a level
of around $3-4k over the next year. For the long-term, my goal is to double
this amount within the next 10 years.

What is a Stock? Stocks (also called stock or share) are part of the capital stock of a company. It represents the original equity paid into the company. The capital stock could be traded at well-known stock markets like the New York Stock Exchange (NYSE) or NASDAQ.Every stock or share represents a partition ownership to the company. A stock owner has the ability to receive dividends and has a voting right for the annual general meeting (AGM). The stock owner participates on the business opportunities and risks.

There are two main stock types available: common stock and preferred stock. A common stock gives the shareowner the ability to vote at the annual general meeting and to receive dividends. A preferred stock has no voting right but for compensation, a higher claim for earnings and assets.

By Dividend Yield - Stock, Capital, Investment

What is a dividend? A dividend is a payment by the company to its shareholders. Normally, a stock pays 4 times a year a quarter dividend in order to participate investors at the company’s success. The amount of dividends in relation to the earnings of a company is called payout ratio. The figure measures the part of the earned money which is paid to the shareholders. A payout ratio of up to 50 percent (half of it's earnings) is a good figure. Sometimes it could be possible that companies can pay 90 percent of its net income due to its business model. Those businesses don’t need much money for growing.

The dividend amount in relation to the price that an investor pays is called the dividend yield. The value measures the return of the investor. A dividend yield of 5 percent (High-Yield) means that the investor receives 5 percent of his investment in cash - pretax within a year. This value is estimated for the full year dividends. Most of the highest yielding dividend stocks have only a big quarter dividend of more than one percent because of it's unsustainable dividends. The capital market expects a dividend dividend cut by the company.

An important date for investors is the ex-dividend date. This is the day on which the new investor doesn’t receive any dividend payments. He must wait 3 month for the next quarter dividend.

By Dividend Yield - Stock, Capital, Investment

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